Optimizing Your Ecommerce Conversion Rate
Ecommerce is a fast-moving industry, with new techniques and tools continually appearing. In just the past month, we've shown you how to adapt your marketing for the Covid-19 pandemic, and how to successfully integrate virtual reality into your marketing strategy. It's important, of course, to pay attention to all of these emerging trends in order to get the best performance from your online store.
On the other hand, some things never change. No matter what kind of eCommerce store you run, "conversion rate" will always be one of your most important metrics. In this article, we'll show you how to calculate your conversion rate, and then how to improve it.
Calculating Your Conversion Rate
Though "conversion rate" is often talked about as a single metric, in reality, it would be more accurate to talk about "conversion rates" in the plural. Though your conversion rate can be simply defined as the number of visitors to your store that is converted into customers, in order to make the most of this statistic you need to break it down further.
If 2% of your visitors buy a product from you, you are doing pretty well. However, this headline figure doesn't tell you very much about who is buying from you, what they are buying, or how they are finding it. In order to make your conversion rate useful, you need to carefully segment your products and audience, so you can see where your store's performance can be improved.
Optimizing Conversion Rates
The next step in optimizing your conversion rate is to invest in a tool that can give you the level of analysis you need. There are plenty available, with Google Analytics and HotJar being the most popular.
Armed with these tools, you can begin to look at your conversion rate, and improve it. Though there are hundreds of ways of doing this, they can be broken into four major aspects.
A brand's reputation is often overlooked when it comes to improving conversion rates, but it remains one of the most important factors in encouraging visitors to make a purchase. Despite new eCommerce companies springing up every week, most consumers still prefer to buy from companies that they have heard of, who have been recommended by a friend, and who they trust.
Because of this, engaging in an ongoing process of reputation management is as important as implementing some of the more technical tools on this list. This process involves cementing your brand image in the minds of your customers, but also protecting your online reputation by making sure that your eCommerce store is as secure as possible.
2. Product Pricing
Product pricing is a huge and complex field, but for most eCommerce stores there is a basic principle at play: you need to make your products cheaper than your competitors. Consumers are more likely than ever to shop around for the best price, and your products should offer the best value in order to improve your conversion rate.
Going further, there are a few techniques that you can use to highlight your value proposition. One is to offer free shipping, which often provides the final impetus for customers to make a purchase. Another is to plan a period of loss-leading on a new product, backed up by business loans which, if calculated properly, should cover the initial shortfall in profits. This can be an excellent way of encouraging first-time buyers to your store and enhancing your reputation.
3. The Customer Journey
Let's look a little deeper into the technical aspects of your eCommerce store. In one sense, your conversion rate is simply the end of a journey that each of your customers takes through your online store. In order to get every visitor to the end of that journey, every page they pass-through should be easy to use, well-designed, and beautiful.
Many of the tools available for analyzing your conversion rate will automatically produce statistics on how individual visitors are using your site, and where they are likely to abandon their visit. If you want to take this form of analysis to the next level, however, you can make use of AI marketing tools that aim to intelligently predict customer behavior.
Whichever tools you use, the basic principle of improving your conversion rate stays the same: focus on the pages and processes where you are losing customers and make them easier to navigate.
4. Stay Engaged
Most customers will make multiple visits to a particular eCommerce store before they make a purchase and show up in your conversion rate. You should, therefore, recognize that it is not only your store itself that contributes to your conversion rate. You should also make sure you are using social media to engage with your customers, and ensure that your remote marketing team is also heavily involved in improving your conversion rate.
This is an aspect of conversion rate improvement that is often forgotten about because plenty of eCommerce store owners still see social media marketing as a way of directing customers to your store. If used correctly, it can be much more: you can use these tools to directly engage with your customers, answer any questions they have about your products, and encourage them to leave reviews that will enhance your reputation.
The Bottom Line
There are many creative ways to market your small business, and many new tools for eCommerce businesses become available every year. Improving conversion rates is still one of the most important processes that online retailers can undertake, however, and is also unlikely to be automated in the coming decade.
That's because, like any form of quality marketing, improving your conversion rate is about far more than just counting clicks. At the most fundamental level, conversions are driven by reputation, value, and your relationship with your customers. So take a look at the stats, but don't forget that behind them are real people.